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CIPS L4M2 - Defining Business Need > Chapter 3.1 > Flashcards

Chapter 3.1 Flashcards

1
Q

Define procurement specification

A

A document that presents prospective suppliers with a clear, accurate and full description of the organisations needs and enables them to propose a solution to meet those needs

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2
Q

Define statement of needs

A

The definition of a business problem or opportunity together with the criteria that define it

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3
Q

Define cross-functional team

A

Teams that involve individuals from different departments who work together towards a common goal. This could be a group of people working on a defined project who come from different functions or departments of the company. It can also include members who are from outside the company, such as suppliers

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4
Q

What is the purpose of a specification?

A

To present prospective suppliers with a clear, accurate and full description of the organisations needs, and so enable them to propose a solution to meet those needs

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5
Q

What is it essential to do when generating specifications

A

That cross-functional and diverse team input is sought to ensure all stakeholder and operating requirements are embraced

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6
Q

How is the suppliers response as to how it will meet the specification usually be received?

A

As a response to a tender

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7
Q

Where may you find the requirements in the specification are found?

A

In the contract with the supplier

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8
Q

What is the starting point of writing a specification?

A

The business requirement definition

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9
Q

Define business requirement definition (BRD)

A

Sets out what the product or service needs to achieve if all stakeholders are to be satisfied

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10
Q

Name one model you can use to identify business requirements

A

RAQSCI

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11
Q

What does the RAQSCI model do?

A

It defines what is needed in terms of the requirements:
Regulatory
Assurance of supply
Quality
Service
Cost
Innovation

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12
Q

What is a useful tool for establishing requirements?

A

The star-burst method

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13
Q

What is the star-burst method?

A

It requires participants to list questions that would need to be answered to fully identify the elements of the BRD. You write in the middle of the star the element of the BRD that is being developed then each point around the star is labelled with who, what, when, where, why, how. Next questions are generated radiating out from the six words around the star. When all questions have been created they can be answered, and the answers form the basis of the BRD

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14
Q

Who created the star-burst method?

A

Alex F Osbourne

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15
Q

Name 5 sources of information that can be used to create specifications

A
  1. External standards
  2. Internal expertise and knowledge
  3. Other product specifications
  4. Sustainability considerations
  5. Internet sources
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16
Q

Define standards

A

The measures that show that those expectations have been met

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17
Q

Name 3 examples of standards

A
  1. The level of performance of a machine
  2. The quality of materials that have been used
  3. Safety levels in food and drink
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18
Q

Name one organisation that provides standards

A

International Organisation for standardisation (ISO)

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19
Q

State what the ISO is

A

An independent non-governmental international organisation with a membership of 162 national standard bodies.
Through its members it brings together experts to share knowledge and develop voluntary, consensus based, market relevant International Standards that support innovation and provide solutions to global challenges

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20
Q

How many standards have the ISO published?

A

More than 22,000

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21
Q

What do the ISO standards range from?

A

Technology and food safety to agriculture and health care

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22
Q

What is the US equivalent for ISO

A

ANSI - American national standards institute

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23
Q

What does EN stand for in relation to standards

A

Euro Norms

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24
Q

What does SANS stand for in relation to standards

A

South African National Standards

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25
Q

What would you do in terms of standards when developing an output or outcome based specification

A

Use a related standard and adapt it

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26
Q

What can be a source of information for standard products that fall into the technical specification category?

A

Directories

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27
Q

What is the ISO equivalent for the USA

A

National Directory of Commodity Specifications

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28
Q

Name 3 examples of specialist online sources of information for recognised classifications such as construction

A
  1. 4specs.com
  2. Sweets.construction.com
  3. Specificationsonline.co.uk
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29
Q

What should you utilise when designing a specification?

A

Internal expertise and knowledge of other people within an organisation

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30
Q

What is ISO9001 in relation to?

A

Quality management

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31
Q

What is ISO14001 in relation to?

A

Environmental management

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32
Q

When should a production department be consulted in specification design?

A

If the business requirement is for an internal need such as the procurement of machinery to be used in production

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33
Q

Why are procurement departments consulted during specification design?

A

To provide information on the supply market for the specified goods and services

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34
Q

Name 3 things procurement can provide insight into when designing specifications

A
  1. Potential suppliers
  2. Capability of suppliers
  3. Availability of materials
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35
Q

Name 3 things procurement can advise on when designing specifications

A
  1. Who is likely to provide the goods or services at a lower cost or better quality
  2. Who provides the best customer service or who has more preferable payment terms
  3. Potential suppliers that could be consulted for early supplier involvement (ESI)
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36
Q

What is the purpose of market testing/market sounding

A

To assess how interested suppliers may be when the organisation invites bids. This saves a lot of time and money as it prevents the organisation from going to market and then finding that no one bids

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37
Q

Name 7 reasons for market sounding

A
  1. Doubt as to whether market exists
  2. Doubts about the capacity or capability of supply markets to deliver the requirements if a market does exist
  3. Uncertainty as to whether the market is competitive
  4. Uncertainty over the finance options that might be required
  5. Uncertainty about the potential cost or ffordability of the requirement
  6. Uncertainty as to whether one supplier is capable or a consortium is needed
  7. Doubt over the delivery method
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38
Q

Define early supplier involvement

A

The involvement of the supplier in the product development process from a very early stage in order to use the suppliers existing experience and expertise

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39
Q

In addition to cost reduction, what 3 things can early supplier involvement bring about?

A
  1. Process improvements
  2. Supply chain improvements
  3. Reduced supply risk
40
Q

As a product goes through its life-cycle what happens to the cost?

A

It becomes more and more fixed

41
Q

Why is it important to involve suppliers as early as possible?

A

So that they can help to avoid embedding costs in the design that cannot later be eliminated or reduced

42
Q

Name the 8 key steps in early supplier involvement

A
  1. A sound understanding of customer needs
  2. Design a project to meet the needs and objectives and agree and share the scope
  3. Develop target costs for each of the items that will be sourced externally from supply markets
  4. Prepare a detailed implementation plan including any sourcing activities such as running a tender
  5. All of this is shared with colleagues in operations and their input is added to the plans
  6. At this stage it is not possible to draw up a list of potential suppliers to be involved in developing the specification
  7. These suppliers are invited to participate in the development of the specification at a series of workshops
  8. Conduct value engineerings to identify ways of meeting the project brief
43
Q

When is procurement in a better position to negotiate with suppliers or run a tender?

A

Once the specification has been developed

44
Q

Name 3 things early supplier involvement improve?

A
  1. The quality and reduce costs using an improved product design which makes it easier for suppliers to produce efficiently
  2. Helps to reduce the time taken to bring a product to market for the first time as there will be fewer iterations in the design
  3. Good way of building trust and long-term relationships between organisations
45
Q

What could you do to save resources instead of designing a specification?

A

Adapt or modify existing specifications

46
Q

Name 4 things you can do instead of designing a specification

A
  1. Look at products you have bought previously which could be suitable to fulfil a new need with few modifications
  2. Look at adapting existing product specifications rather than developing new ones
  3. Modify an existing product rather than changing it completely
  4. Buy a modified version of a suppliers standard product
47
Q

When will an organisation have a competitive advantage

A

By embracing sustainability

48
Q

Name the 3 principles of sustainability

A
  1. People
  2. Planet
  3. Profit
49
Q

Name 3 aspects when designing specifications, organisations will have to think of

A
  1. Social aspects
  2. Environmental aspects
  3. Economic aspects
50
Q

Name 6 examples of sustainability factors that will need to be taken into account within a specification

A
  1. use of renewable and non-renewable materials
  2. Energy use
  3. Logistics methods
  4. Removal of hazardous waste
  5. Whole-life costs, including end of life options for a product or asset
  6. Working conditions and employment standards throughout the supply chain
51
Q

Name 7 sources of information organisations can use to research sustainable practises

A
  1. Certifications such as Fairtrade or the Forest Stewardship Council
  2. Professional bodies such as CIPS
  3. 17 sustainable development goals created by the UN
  4. International standards such as ISO26000
  5. Government websites such as Crown Commercial Services
  6. International Labour Organisation (ILO)
  7. Charities/NGOS such as Oxfam, greenpeace and the world resources institute
52
Q

What can be a powerful tool for finding information to develop specifications?

A

The internet

53
Q

What acronym can be used for checks and test of information retrieved from the internet

A

SAMOA

54
Q

What does SAMOA stand for?

A

Source
Audience
Methodology
Objectivity
Accuracy

55
Q

Define design specification

A

A detailed document that sets out the precise way that a product must be built or a service delivered and includes any technical drawings, standards that must be met and dimensions

56
Q

Define functional requirements

A

Functional requirements describe what a product or service should do

57
Q

Define non-functional requirements

A

Describe how a product or service should operate

58
Q

Define ergonomics

A

The consideration of people’s efficiency in the work environment

59
Q

Define conformance

A

The ability of a product or service to meet its design specification

60
Q

When may a business develop its own specification to increase the potential supply base?

A

If the cost of the standard item is unacceptably high or if there is a supply risk because the product is protected by a patent

61
Q

What is a danger of creating your own specification

A

The specification produced is too detailed and so incurs unnecessary cost because it does not allow suppliers to use their expertise in finding the most efficient way to produce it

62
Q

Define technical (conformance) specification

A

A detailed technical description together with acceptance criteria that forms the basis of a product design

63
Q

Define tolerances

A

The permissible limit of a variable used to define a product - for example, its physical dimensions

64
Q

What does BSI stand for

A

British Standards Insitutes

65
Q

Who are conformance/technical specifications usually produced by?

A

A national or governing body such as the British Standards Institute

66
Q

Name one reason for specifying a product with a national or international specification

A

If they have a wide application they are often high in demand meaning they have a long production run which are high in efficiency and low in cost. The low costs can be passed on to the buyer in the form of lower prices

67
Q

Name an advantage of a technical specification often being produced by a national or international body

A

A buyer can select from a wide range of suppliers knowing that it will receive the same quality from each of them

68
Q

What is complementary to a technical specification

A

A drawing

69
Q

What does a drawing do

A

Puts into a visual form the idea that the designer has for the product and they include the technical specifications required

70
Q

Why are drawings often accepted as legal documents?

A

The way in which they are produced means they can be accurately interpreted (often by people who speak different languages) and so there is no ambiguity in what is required

71
Q

Name 5 things a drawing might include

A
  1. Drawings of the component part of sub-assembilies
  2. A list of the parts to be used with their specifications
  3. Drawings of how the components come together to form the end product
  4. Any requirements for the finished look of the item together with relevant data
  5. Reference to any applicable installation requirements and testing specifications
72
Q

What risk is transferred when developing your own specification

A

Doing this transfers the risk from the supplier to the buyer as the buying organisation is now specifying factors such as tolerances

73
Q

Define performance specification

A

A description of the outputs or outcomes that are expected with the detailed design of the product or service left to the supplier to decide

74
Q

Define outcome-focused specification

A

Type of performance specification that describes the functions or performance that a product must fulfil. An example of an outcome-based specification is the concept of payment by results

75
Q

What does a performance specification avoid?

A

The drawbacks of the design specification by providing the specific performance that is required by not the method of achieving that performance

76
Q

Why should suppliers have lower costs that can be passed on to the buyer in a performance specification?

A

The supplier is free to choose the materials they use and the manufacturing process, or delivery process if it is a service that is being brought

77
Q

Name 4 major types of performance specifications

A
  1. Outcome specifications
  2. Output specifications
  3. Functional specifications
  4. Statement of work specifications
78
Q

Name 5 examples of capabilities of suppliers

A
  1. Skills
  2. Abilities
  3. Knowledge
  4. Experience
  5. Technology
79
Q

What should the outcome specification identify?

A

What needs to be achieved and the capabilities that are required to achieve that outcome

80
Q

What does specifying requirements in terms of outputs or functions give potential suppliers the opportunity to do?

A

Propose innovative solutions or to simply be more creative in their proposals. It also means that the responsibility for ensuring the solution meets the requirement rests with the supplier rather than the customer

81
Q

Name 3 major difficulties with outcome specifications

A
  1. How to measure them
  2. Long time delay between the supplier taking action under the terms of the specification and the achievement of a result
  3. More than one output can affect an outcome and not all of these may be in the scope of the supplier who is awarded the contract
82
Q

Why may it be preferential to use an output specification

A

You can assume that the outputs will deliver the outcome even if the outcome is not formally measured

83
Q

Define output specification

A

Defines specific deliverables that can be measured in terms of time to deliver, their quality and their cost

84
Q

What are outcomes delivered by?

A

Outputs which are the result of one or more processes that use inputs

85
Q

Define statement of work (SoW)

A

Detailed description of the specific tasks or services a contractor must perform under the terms of a contract

86
Q

What two types of specification can be supported by a statement of work

A
  1. Output spec
  2. Outcome spec
87
Q

When is a statement of work commonly used?

A

In projects and services

88
Q

What does the statement of work define

A

Activities, deliverables and timelines for services provided

89
Q

Name 3 main types of statements of work

A
  1. A design SoW in which the supplier is instructed as to how the work should be done, the quality levels required and the specifications of any materials used
  2. A level of effort and materials/unit rate SoW
  3. Performance based SoW
90
Q

Name 10 things you may typically include in a SoW

A
  1. The purpose of the project or service
  2. The scope of the work involved
  3. Where the work will be carried out
  4. A more detailed set of tasks to support the overall tasks quoted
  5. Milestones that determine the overall length of the project
  6. List of specific outputs or deliverables expected and when they are due
  7. A description of any testing that needs to be performed
  8. A definition of what will constitute a successful project in the eyes of the stakeholders
  9. A payment schedule detailing what will be paid, for what and when
  10. A description of how the project will be closed out in terms of any final testing and approval signatures needed
91
Q

What is a functional specification?

A

Type of outcome-based specification

92
Q

What does a functional specification outline?

A

Exactly what it is that the end product or service should do or how it should be provided

93
Q

Where are functional specifications more commonly used?

A

In systems engineering and software development

94
Q

What are functional specifications primarily focused on?

A

The user experience

95
Q

What should functional specifications incorporate?

A

The basic functional requirements for the end users perspective

96
Q

Would a functional specification include technical information or details of the design?

A

No

CIPS L4M2 - Defining Business Need (12 decks)

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